Time to Cash In Your U.S. Savings Bonds?

Whether you got them as a birthday gift from Grandma or bought them through a payroll deduction on your first job, you may own U.S. Savings Bonds that have stopped earning interest.

Series EE Bonds, the common variety first issued in 1980, were designed to pay interest for up to 30 years. So any bonds dated 1988 or earlier – the first generation, so to speak – will have stopped paying by the end of 2018. At that point, their value is frozen, so there is no reason other than nostalgia to hang onto them. Instead, you can cash them in and put the money to more productive use. (They are still being issued, by the way, and you can evaluate them in U.S. Savings Bonds: Best Long-term Bond Investment Available?)

Before the advent of Series EE Bonds, Grandma might have bought you a Series E Savings Bond. Those were issued from 1941 to 1980, and all of them have stopped earning interest, too.

The more recent Series I Bonds, the kind that pays a combined fixed and inflation-adjusted rate of interest, were first issued in 1998. They’re good for 30 years, so the earliest of them will stop gaining value in 2028.

How much unclaimed money is out there in the form of savings bonds that have stopped earning interest but have yet to be redeemed? The U.S. Treasury Department estimates that it’s in the billions of dollars.

What Your Bonds Are Worth

To determine the value of your old bonds, you can use the Savings Bond Calculator on the TreasuryDirect website. You’ll just need the type of bond, its denomination, and the date it was issued. There’s also a place to type in your bond’s serial number, but you don’t need that in order to get a value.

The calculator’s answer may pleasantly surprise you. For example, a $50 bond issued in August 1982, for which Grandma would have paid $25, is now worth $146.90. A $100 bond from February 1984 is good for $230.64. 

If you believe you own some old savings bonds, but have lost track of them, you may be able file a claim for the bonds with the Treasury, by filling out Fiscal Service Form 1048, Claim for Lost, Stolen, or Destroyed United States Savings Bonds, available with instructions on the website. Unfortunately the popular online tool, Treasury Hunt, was discontinued in early 2017.

How to Cash In

You can redeem your old paper bonds at many banks and other financial institutions. The TreasuryDirect website doesn’t maintain a list, but suggests you call around.

Bear in mind that savings-bond interest is subject to federal income tax, though not to state or local tax. You can either report it and pay tax every year that you hold the bond or wait until the end and pay the tax all at once, as most people do. After redeeming your bonds, you’ll receive an IRS Form 1099-INT, reflecting your taxable gain

An exception, in certain cases, is if you use the proceeds from bonds issued in 1990 or later to pay qualified higher-education expenses for yourself or your child. Those rules, which include income limits, are explained in the Education Planning section of the TreasuryDirect site. 

The Bottom Line

Don't sit on cash that's coming to you. But before you cash in your bonds, it’s a good idea to record what the Savings Bond Calculator says they’re worth, just to be sure you get every dollar you're owed.

Grandma wouldn’t want it any other way.

New Articles:

aetna provider number lookup how to redeem savings bonds cars with zero down payment stock market game.org donut house franchise historical exchange rates usd to cad turbo tax track my refund salary tax california calculator minimum wage for sc how much is a visa gift card at walmart power tactics in organizational behavior notarizing documents how to invest in stock market for beginners world top 100 richest country federal payroll tax withholding tables 182 usd to aud american express platinum foreign transaction fee software to keep track of expenses bd xxxxxxx what payroll taxes are deductible by the employer convert aus dollar to us dollar flying miles credit cards hourly to salary conversion calculator low credit score credit cards unsecured taxable rental income how to become a certified realtor amazon credit card payment chase production kpis examples brazil visa for indian passport holders dhs dirhams meaning of violence in hindi amex airport lounges currency exchange td

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.